Smith, who up until last week was an executive director at
Goldman, described the firm in
his op-ed as "toxic and destructive" and slammed the culture
under Lloyd Blankfein saying that the firm puts
making money over clients. He also claimed that five different
managing directors referred to their clients as "muppets."

The blogger Jacki Zehner worked at the Goldman for 14 years
before leaving in 2002. During her tenure, she said she had
the honor of serving on the Partnership Committee where she
witnessed promotions. One thing that would piss her off was
when "jerks" who may have performed better commercially were
promoted over those who were "culture carriers" but who were less
strong commercially.

Zehner, who acknowledged cultural changes during her time at the
bank, said her sources have told her Goldman has changed in
recent years.

Many people over the past few years have told me that Goldman
has increasingly become tilted towards the money side at the cost
of the firm’s character. I cannot tell you the number of times I
have heard ‘Goldman is not the place it was’ and that truly
breaks my heart. Mr. Smith was right in saying that a trajectory
of descent occurs over time when more and more people are
promoted who are not good culture carriers. It that is the case,
then correcting this will also take time by weeding out the toxic
people, and promoting ones who are BOTH commercially and
customer-oriented.

In her blog, she also pointed out that it's unfair for Smith "to
paint all people who work at Goldman, or Morgan Stanley, or any other firm with the same
brush."

I also have to make this point: Mr. Smith likely does not
know even the tiniest fraction of the 30,000 something people who
work at the firm, the majority of whom are a long way from the
trading floor in Europe or anywhere else. The vast majority of
people do their job in a deeply respectful way. It is just not
right or fair to paint all people who work at Goldman, or Morgan
Stanley, or any other firm with the same brush. Most don’t make a
million dollars a year and most are not ‘masters of the
universe.’ Most are just normal, good people who chose a
career in finance when that was a really acceptable thing to do.
It seems to me that Mr. Smith is really speaking to
the ‘five different managing directors’ who he has had deep
interaction with and the upward chain of command that promoted
them to those positions. Maybe he is also talking about the
trading businesses in general but he is certainly not
talking about the 1,200 people who live and work in Salt Lake
City? Has he ever even been there?

Zehner, who said she does not know Smith or anyone who does,
thinks the board has a responsibility to investigate his
claims.

So what now? Will this article have consequences? I hope so.
These are very serious accusations from a credible person in my
view and I hope it does indeed provide a ‘wake-up’ call to the
board of directors. It is their responsibility to ensure that
promotion and compensation decisions are not divorced from peer
reviews and customer feedback. It is their responsibility to
ensure that traders, and especially ones who do not have the best
interests of clients in mind, do not dominate the firm. It is the
board that is accountable to the shareholders and before they
take another paycheck, I hope they ask a heck of a lot of
questions and get honest answers. If those answers do not reflect
the kind of behavior reported by Mr. Smith, then they would have
done their job, this story will fade, and Goldman will go about
its business for another 143 years. If the answers are the
opposite, heads should roll.

I am not defending Goldman nor am I attacking
them. I just cannot as it is just way too personal for
me. At times, in private conversation, I can be their most
passionate supporter, and at other moments, their worst critic.
Both come from a place of wanting Goldman to be what it
was, and what it could and should be. Thoughts of
parenting come to mind.

She ended her piece with a personal message for Smith.

To Mr. Smith: If what you described in your OpEd was indeed
your honest and unembellished personal experience, you were right
to quit, and it was very brave to put yourself out there. If not,
and you are a disgruntled employee who wants his moment in the
sun, shame on you. Either way, as you did currently state,
without clients they will not make money, or at least make a heck
of a lot less.